Japan may accelerate around $1 billion of planned spending to upgrade its ballistic missile defenses in the wake of rocket tests suggesting North Korea is close to fielding a more potent medium-range missile, three government sources told Reuters.

North Korea fired a submarine-launched missile on Wednesday that flew about 500 km (311 miles) towards Japan, a show of improving technological capability for the isolated country that has conducted a series of launches in defiance of U.N. sanctions.

Foreign states are developing high-speed, maneuvering missiles, and the Pentagon and U.S. Pacific Command want weapons to counter them, a leading defense contractor involved in missile defense said Monday.

North Korea launched a ballistic missile on Wednesday that landed in or near Japanese-controlled waters for the first time, the latest in a series of launches by the isolated country in defiance of United Nations Security Council resolutions.

The Chinese Defense Ministry announced Thursday that China and Russia will conduct joint naval exercises in the disputed South China Sea in September despite a recent international tribunal ruling that rejected Beijing’s claims to the strategic waterway.

China, Russia, and rogue states like Iran are investing in advanced missile technology that will threaten the United States.

The Obama administration’s defense policy has lagged in the field of missile deterrence, according to a new study from the Hudson Institute prepared with input from former officials and military leaders.